Multichannel Sales

4 Key Metrics to Improve Your Multichannel Sales Performance

        1. Key Metrics to Improve Your Multichannel Sales Performance
        2. In Summary

Let’s face it; multichannel sales are the future of commerce. In fact, we believe that it’s already here. 

As per HBR, around 73% of customers use multiple shopping channels. And this was back in 2015. After the e-Commerce boom during the pandemic, this statistic might be up in the high 90s. 

The bottom line is that for businesses to thrive in today’s competitive business environment, where customer expectations and preferences change at lightning speed, a multichannel approach is mandatory. 

But adopting a multichannel approach isn’t where it ends. It’s not guaranteed success. It’s just where things start. For a multichannel approach to work, you need to have clear visibility across all channels, know what’s working and what isn’t, and adjust accordingly. 

And there’s only one thing that can guide this discipline. That’s right, metrics. 

So, if your business is spread across multiple channels but you’re struggling to make the most of them together, here are 4 metrics that can help you improve your marketplace management.

Key Metrics to Improve Your Multichannel Sales Performance

  1. Gross Margin

You calculate your margins as the final metric to track your multichannel profits and understand the success of your strategies.

Here’s how you do it:

  • Revenue – Cost of Goods = Profit/Gross Margin

You can also calculate it as a percentage to know what part of your revenue is profits. 

  • Gross Margin Percentage = (Gross Margin/Revenue) * 100

The higher the percentage, the more profitable your business is. 

Also, bigger profit slices mean you can invest back in your business to expand either horizontally or vertically. More channels can be added, customer experience can be streamlined, or brand awareness can be enhanced. 

With Ordazzle’s top-of-the-line omnichannel solutions, you get access to a unified dashboard across all your channels, making it easy to track your progress and optimize channel performance as per your needs.

  1. Track Customer Experience

Even though this metric isn’t directly related to multichannel sales strategies, it will give you an idea of what customers think about your brand. With more insights into customer behavior and perception, you can accordingly change your 

Customers today expect a lot from brands, so much so that even a split-second delay in service delivery can make them switch to your competitor. So, seamless transitions between different devices and channels are critical. 

But how do you measure if the experience you’re providing is adequate or lacking? The simple answer is feedback. Yes, you can ask your shopper about how likely they are to recommend your products/services on a scale of 1 to 10, and depending on their response, you can segregate them into 3 categories: 

  • Promoters (score as high as 9-10): They like your offerings a lot and are likely to become brand advocates. 
  • Passives (7-8): Although these shoppers are satisfied, they will switch to a competitor brand if they face an issue with your offerings. 
  • Detractors (6 or below): This demographic includes people who are not at all satisfied with your product or service. 

After you’ve completed your feedback survey, you must subtract the number of detractors from the number of promoters. This will give you your net promoter score (NPS). It should practically remain in positive numbers, as it’s an indicator that more people are satisfied with your brand. Ideally, it should be well above 50%.

  1. Customer Lifetime Value

Customer lifetime value is a crucial e-Commerce metric, especially when multichannel sales are involved. It provides an idea of the business’s long-term and financial viability. 

High CLV is an indicator of brand loyalty, recurring revenue from existing customers, and product-market fit. That’s why it is recommended that e-Commerce businesses track, monitor, and optimize CLV if they are looking to establish steady growth. 

Although it depends on several factors, the average CLV for e-Commerce companies is $168.

Here are some values that you need to understand your customer’s lifetime value:

  • Average Order Size (A) = Revenue earned/orders generated
  • Average Order Frequency (B) = Number of orders/Number of customers
  • Average Customer Value (C) = B/A
  • Average Customer Life (D) = Last Order Date – First Order Date

Based on these, your CLV is B*A

  1. Channel Performance

When you’re thinking multichannel, you need to track channel-wise performance. For this, you need consistent data collection and analysis across all your channels. 

Some essential data that you can collect is:

  • No. of orders generated per channel
  • Revenue generated
  • Gross Merchandise Value (quarterly)
  • Proportion of visitors vs. customers

Based on the data, you can understand what the best channels are and build your sales plan accordingly.

ALSO READ: Using a Centralised Channel Management System to Improve E-commerce Cross-Channel Alignment 

In Summary

If you wish to create winning multichannel strategies, you need to have visibility over all these metrics and make sales activities, channel behaviour, and customer experience the heart of your approach. 

Also, by measuring these KPIs, you’ll be able to understand how successful your multichannel sales efforts have been and how you can proceed in the future. With regular tracking and analysis, you can set your benchmarks effectively and optimize whenever necessary. 

Ordazzle’s e-Commerce management platform gives you complete visibility and control over all the key metrics mentioned above, making strategy, planning, and execution that much easier. 

Connect with us today and see our capabilities for yourself.